I absolutely agree, Kris! I'm only arguing EVs relative to ICEs. Moving a person or two at significant speed in a 1-1/2 ton box is energy intensive any way you cut it! Unfortunately, areas like mine have a lot of hills, are hostile to non-motor traffic, and have very weak public transport.

It did occur to me that it could have been an urban legend.
I did a little bit more research, and there are reports that the console warning lights go crazy and inform that one really needs to add fuel before running out. Then it makes sure that the driver knows that there is no fuel. Once someone shuts it down without fuel and attempts to start it, it will give three chances to start with enough fuel before it shuts down and requires an engine code reset. There are reports that people might have been able to get up to two miles on the battery alone, although it progressively lowers speed (maxes at about 18 MPH).
So perhaps my original understanding was off. Turns out more detailed reports are that they are designed to keep the battery from depleting. However, running out of fuel is a bad idea. I don't know if Toyota will consider it abuse for warranty claims.

"typically halving the range" - a bit of an exaggeration - I'd say more like "at the extreme tail, it MIGHT halve your range..." it's more like 2/3rds your range. Case in point, on a single charge, my Volt will break 50 miles all electric. In close to freezing, it might go down to 33-35 miles... I admit that I've never driven it in sub-freezing levels, but people were never meant to live in such places, much less drive! ;-)

People talked about the original Prius batteries costing $10k to replace (oddly enough the same figure) back when they came out. Now, years later, the very first Prius' are beginning to need new batteries, and they can be replaced for between $1500 to $2500. Sounds like it's worth doing in most cases.
As far as "free or low cost service for 100,000 miles" , yeah... right... let me tally up what the service costs were for my Audi A6 Turbo for miles 60,000 to 100,000 (the first 60,000 were under warranty - needed to dump or extend the warranty before 60,000...) Those 40,000 miles were a lot more than $10,000...

How about a source rather than an anecdotal, unsubstantiated "what-if"? You actually KNOW someone who "abused" the battery thusly, it died completely in these two years, and they refused to replace the battery due to the "abuse" because they could pull the record from the car.
Sounds highly unlikely for many reasons to me.

I am not willing to pay a premium for an electric car. If an electric car has a range of 100 miles (I commute 90 miles per day) between charges in the dead of winter at 15 degrees F and costs no more than a ICE car, I will buy it. If not, forget it.

EV ideal for commuters? I doubt it, bus or train is better...in general I just don't see a value proposition for electric cars: they use energy generated from sources that pollute (green energy is still very small fraction of the overall energy) so the environmental impact is small, charging takes forever, the batteries are expensive and last 10 years at best...EVs are stuck in crossing the chasm...yes, some people, some industries, some services will use them but mainstream consumers, I doubt it...personally I prefer to walk, bike and use public transportation whenever I can (we still own two cars thought, hope to get rid of one eventually)...Kris

Why would you have to wait to charge? The current EVs are perfect for commuters, which is what many cars are purchased for, so an overnight charge will suit a day's driving.
As for price, a prominent industry marketing study determined the crossover price where people would buy an EV to be ~$22k. The new 2013 LEAF price starts at $28,800 less $7500 tax credit = $21,300. Many states have more credits to lower it still. And fuel costs will save you ~$500/yr over those for a Prius.
Either people will be flocking to the car now, or it will prove how fickle and afraid people are to change, even if it's for the better.
Try one; you might like it.

I agree with Brian - "It is very difficult for people to embrace a product to replace something they already have" Yet, ultimately, EV makers have to consider the habit of consumer and realize consumers are sensitive to price. Realistically speaking, are you willing to wait for 30 minutes or an hour to get your car charged up? Are you willing to pay a premium to buy a car that can move you in a limited range?
There isn't much doubt that EV will become one of the major transportation in the near future. It might already become today's in some cities that have the convenience of park and charge. I'm sure there will be a lot more work to do in infrastructure to support the proliferation of EV.